Apple Considering Ending Partnership with Goldman Sachs
Apple is considering ending its partnership with Goldman Sachs, which includes the Apple Card and savings accounts under the Apple brand. This potential move, according to a person familiar with the matter, could take place within the next 12 to 15 months, effectively ending one of the highest profile partnerships between a bank and a tech company.
A Rocky Partnership
Goldman Sachs CEO David Solomon was present when Apple first launched the Apple Card in 2019, signaling a seemingly strong collaboration between the two companies. However, the partnership has been rocky in recent years. This is because Goldman Sachs has retreated from its previous consumer banking ambitions due to escalating costs. The bank has also faced regulatory scrutiny related to refunds and billing errors, as well as allegations of gender discrimination when determining credit limits.
Strategic Alternatives Considered
Earlier this year, Goldman Sachs announced that it would “consider strategic alternatives” for its consumer banking business. This raised questions about the future of its partnership with Apple, particularly in light of its struggles with regulatory issues and a shift in focus away from consumer banking. This shift has ultimately led to the potential dissolution of the partnership.
Impact on Apple and Goldman Sachs
For Apple, the credit card and savings accounts are ways to add value and features to its iPhone, as well as to enhance its services business with fees. However, if the partnership ends, Apple would need to find a new financial partner. It is uncertain whether Apple has found a new partner or if it would consider making significant changes to its financial products.
Goldman Sachs, on the other hand, is currently handling the banking backend for both the Apple Card and the high-yield savings accounts. The termination of the partnership would necessitate a shift in its consumer banking strategy and could have financial implications for the bank.
Statements from Apple and Goldman Sachs
When approached for comment, Apple stated, “Apple and Goldman Sachs are focused on providing an incredible experience for our customers to help them lead healthier financial lives. The award-winning Apple Card has seen a great reception from consumers, and we will continue to innovate and deliver the best tools and services for them.”
Goldman Sachs, on the other hand, declined to comment on the proposal, which was previously reported by the Wall Street Journal.
Conclusion
The potential termination of the partnership between Apple and Goldman Sachs could have significant implications for both companies. As the situation unfolds, it remains to be seen how Apple will navigate the future of its financial products and how Goldman Sachs will pivot its consumer banking strategy.
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